5G Stocks on the Rise
Whenever a new technology is introduced to the market, excitement is never far behind. Whether a totally new innovation or a superior iteration of a past tech, investors are keenly aware of just how much money can be made—especially when said tech has the potential to radically redesign the way we live.
5G stocks are among the best stocks available right now on the market, having proven that they are resilient to the economic difficulties brought on by COVID-19. They are also well positioned for massive growth moving forward.
Before we delve into my two top 5G stocks, we first have to understand why the 5G industry is so special.
Essentially an improvement to our current mobile networks, 5G tech isn’t special so much for what it does specifically, but instead for what it allows us to accomplish.
Namely, 5G gives us blazing-fast Internet speeds that will radically accelerate integration of technologies like artificial intelligence (AI), Internet of Things (IoT), and machine learning.
Some analysts put the value of the 5G industry in the trillion-dollar range within the next decade (accounting for gains made in AI and similar industries as a result of 5G’s adoption). As you’d expect, the potential for a trillion-dollar industry breaking onto the scene in the next few years has many investors salivating.
That captures the future excitement surrounding 5G stocks, but the power of 5G doesn’t only lie in the future; the present is also making good use of the powers of the technology.
Apple Inc (NASDAQ:AAPL), always keen to keep its tech modern, has already made plans to adopt 5G into its product line, with the express belief that it will help increase sales of the “iPhone.”
Wall Street analysts believe that 5G technology could lead to another surge in cell phone sales, an exciting prospect for phone makers, showing that a knock-on effect may induce gains in ancillary industries as well.
“There is enough complexity and hype when it comes to 5G (the next-generation wireless network) that we believe Apple can exploit this multi-year opportunity,” said D.A. Davidson Companies analyst Tom Forte in a note. (Source: “Apple Has a New Biggest Bull on Wall Street as 5G iPhone launch approaches,” CNBC, January 13, 2020.)
We can expect to see bigger investments made in the 5G space in 2020 as the industry continues to grow.
And while consumer tech like phones begin to integrate the blazing-fast 5G technology, network behemoths are similarly working to ensure that it spreads around the globe.
Companies like AT&T Inc (NYSE:T) are looking to be at the forefront of said global expansion. Last December, the company announced that its 5G network was live in 10 markets. (Source: “AT&T 5G Now Live for Consumers in 10 Markets,” AT&T Inc., December 13, 2019.)
What that amounts to is an amazing opportunity for investors to see huge profits in both the near and long terms. As such, below I’ll highlight two of my top 5G stocks.
Two Top 5G Stocks
Chart courtesy of StockCharts.com
As seen in the above chart, both of my top 5G stocks have not only outperformed the market overall over the past year, but have done so during one of the most calamitous economic times the past decade.
That 5G stocks were not only able to survive, but thrive despite COVID-19 and the economic downturn it induced, shows the staying power of these companies—as well as their stability and their potential for steady growth. Pretty much what the doctor ordered in such volatile times on the market.
With that in mind, let’s delve into why these are my two top 5G stocks.
The first company I’ll tackle is one you may have heard of: Qualcomm, Inc. (NASDAQ:QCOM).
Qualcomm specializes in creating semiconductors and software for wireless technology. Much of that software is, you guessed it, focused on 5G tech.
The company has seen its share price surge over recent years as 5G made its way from ephemeral idea to concrete technology.
What really sets QCOM stock apart from its competitors, however, is the company’s multi-layered approach to 5G tech. Qualcomm stock is a top 5G stock because it incorporates many different technologies in an attempt to unlock the full potential of 5G.
Being involved in so many different aspects of 5G tech gives the company unique exposure to this potential-filled industry.
As it stands, Qualcomm stock has a market cap of nearly $100.0 billion, so this is a company on the larger end of the 5G scale. Having said that, while exponential growth is more likely among smaller 5G stocks, Qualcomm, Inc.’s stability and reliability—coupled with strong potential for gains—marks it as a top 5G stock.
Skyworks Solutions Inc (NASDAQ:SWKS) takes a different approach than Qualcomm, Inc., but one no less filled with potential.
Skyworks is focused primarily on creating semiconductors for 5G, meaning that it is one of the key tech manufacturers for the industry.
Due to its more limited scope, it has a much smaller market cap versus Qualcomm stock, with Skyworks stock holding about a $21.0-billion market cap. That smaller size, however, means exponential gains are more feasible for SWKS stock, as evidenced by its massive growth over the past year.
Much like Qualcomm, however, Skyworks is focused on being one of the major innovators and suppliers in the 5G tech space, meaning its growth will likely closely match that of the industry at large.
One final thing to note is that both Qualcomm stock and Skyworks stock offer dividends to investors, a bonus, as the two stocks already offer high growth potential.
In the past, investors who were able to track and anticipate major technology shake-ups were rewarded with massive payoffs. It’s one of the simplest (in principle, if not in practice) ways to make money from the stock market: invest early in an exciting new tech that is set to impact hundreds of millions of people around the globe.
And that’s exactly what makes the top 5G stocks so damn exciting. This industry is still very much on the ground floor and, as such, more gains are likely on the way.